Groupe Aeroplan Inc. Starts Year on Solid Footing

Common share dividend increased by 20 per cent to $0.60 per share on an annual basis

On track to meet 2011 guidance

Normal course issuer bid ("NCIB") renewed

Canadian redemption reserve reduced from $400 million to $300 million

Canadian region buoyed by record first quarter performance at Aeroplan
and strong results from Carlson Marketing

Europe, the Middle East and Africa region ("EMEA") reflects growth in
Nectar UK, growing contribution from LMG Insight & Communication (I&C)
and full first quarter performance from Nectar Italia

United States and Asia Pacific region (US & APAC) results impacted by
the phasing out of a portion of the Visa business and continued
economic weakness in the US

FIRST QUARTER HIGHLIGHTS

Quarter Ended March 31,

Year Over Year

(in millions, except per share amounts)

2011

2010

% Change

As

As

% Change

Constant

Reported

Reported

Currency2

$

$

Gross Billings

527.9

517.9

1.9%

3.1%

Total Revenue

546.2

508.3

7.5%

8.5%

Operating Income

49.5

25.3

95.2%

92.2%

Net Earnings

25.3

15.3

65.1%

na

Earnings Per Common Share

0.12

0.08

50.0%

na

Adjusted EBITDA1

72.6

55.8

29.9%

29.3%

1. A non-GAAP measurement

2. Includes the translation effect of foreign operations on the
consolidated results. For more information on Constant Currency, please
refer to the Use of Non-GAAP Financial Information section of this news
release.

MONTREAL, May 25, 2011 - (TSX: AER) Groupe Aeroplan Inc.
("Groupe Aeroplan" or the "Corporation") today reported its financial
results for the first quarter ended March 31, 2011 in accordance with
the newly adopted International Financial Reporting Standards (IFRS).
All financial information is in Canadian dollars unless otherwise
noted.

"Our performance in the first quarter was right in line with our
expectations and puts us on target to achieve our objectives for the
year," commented Rupert Duchesne, Groupe Aeroplan's President and Chief
Executive Officer. "We have the broadest range of capabilities in the
loyalty arena and are ahead of the curve as this industry becomes
global. As the established experts, we will continue to build out our
global footprint over the next three years."

Continued Duchesne, "We will increase the long-term profitability and
cash-flow of the businesses as we execute our plans. At the same time,
we continue to deliver value to our shareholders through share
repurchases and common share dividends. In addition to the recently
announced renewal of our normal course issuer bid, we are increasing
our annual common share dividend by 20%. In the last five years, we
have returned more than $900 million to our shareholders, more than
one-third of which was delivered in the last year."

New Regional Reporting Structure

Effective January 1, 2011, Groupe Aeroplan changed its segment reporting
to reflect its new regional structure. The new regional segmentation
allows for the Corporation to optimize both revenue and cost synergies,
brands and technology and to leverage its full suite loyalty expertise
across all markets served. The new structure is as follows:

Canada - includes Aeroplan Canada and Carlson Marketing Canada

Europe, Middle East & Africa (EMEA) - includes Nectar UK, Nectar Italia, I&C, Air Miles Middle East
and Carlson Marketing operations in these regions

United States & Asia Pacific (US & APAC) - includes all Carlson Marketing operations in these
regions

Corporate - includes the investment in Premier Loyalty & Marketing S.A.P.I. de C.V.
(PLM) and strategic and support services to the regions

Aeroplan Miles issued increased by 5.5 per cent in comparison to the
first quarter of 2010

Total Aeroplan Miles redeemed increased by 13.1 per cent driven
primarily by the introduction of a new online air redemption tool
introduced in late 2010, as well as an increase in Miles redeemed for
non-air rewards

Improved performance resulting from increased airline partner activity,
an increase in average consumer spend per active credit card, continued
growth in the retail sector and a recovery in the travel segment

Together with Air Canada, the Aeroplan Program received four Frequent
Traveler Awards, including Airline Program of the Year for the
Americas; Best Redemption Ability; Best Promotion for Earning; Best
Customer Service

Carlson Marketing Canada

Gross Billings increased by 59.3 per cent to $58.8 million, mainly as a
result of the in-sourcing of the Aeroplan Canada non-air rewards
fulfillment; Adjusted EBITDA increased 151.2 per cent to $10.8 million

Strong start to the year driven by growth in the financial vertical

EMEA

8.4 per cent increase in Gross Billings, 11.9 per cent increase on a
constant currency basis

Adjusted EBITDA of $3.2 million vs. $(8.5) million in 2010 (first quarter 2011 includes the effect of a $2.2 million net expense
to earnings in the period related to the ECJ VAT Judgment)

Nectar UK

Nectar Points issued in the three month period decreased by 0.3 per cent
compared to 2010 as growth in the grocery and online sectors was offset
primarily by the timing associated with the change to new Accumulation
Partner, British Gas

Redemption activity increased by 6.4 per cent mainly driven by an
increase in the overall number of Nectar Points in circulation and the
continued popularity of online rewards

Nectar Italia

Nectar Italia Points issued increased by 52 per cent due to a full
quarter of operations compared to one month in the same period last
year, as well as an increase in the number of Accumulation Partners

Increased redemptions compared to the same period last year due to full
quarter of operations versus one month of operations in Q1 2010

LMG Insight & Communication

Revenue increase of 97.5 per cent compared to the first quarter of 2010
driven by increased activity in both the UK and internationally

Signed strategic partnership with Coles, the leading Australian
supermarket retailer

US & APAC

19.8 per cent decrease in Gross Billings, 18.0 per cent decrease on a
constant currency basis

Adjusted EBITDA of $(6.9) million vs. $3.0 million in 2010

Decrease primarily resulting from the phasing out of a portion of
the Visa business in the US

While the US economy is still negatively impacting growth, the longer
term outlook in the US remains positive, as benefits of expanded
relationships with existing clients and the signing of new clients in
new verticals are expected to affect operations in 2011 and beyond

Asia Pacific is on track for solid performance through the year with
extended agreements signed with both ExxonMobil and Qantas and new
client Bendigo Bank in Australia.

PLM - Club Premier

On February 28, 2011, Groupe Aeroplan completed the second tranche
of its investment in PLM of US$11.8 million ($11.8 million), bringing
its equity participation to 28.86 per cent. The disbursement was made
following PLM's important milestone signature and launch announcement
of the co-branded credit card agreement among PLM, Aeromexico and Grupo
Financiero Banamex, one of Mexico's largest financial institutions.
From this date forward, the investment, which is now subject to joint
control with Grupo Aeromexico S.A.B. de C.V., is accounted for under
the equity method. As a result, Groupe Aeroplan now records its share
of PLM's net earnings in a line item, in the statement of operations,
on the same basis as if the two entities had been consolidated. For
this quarter, Groupe Aeroplan recorded $6.1 million in equity earnings.
This included a fair value gain of $3.3 million, related to the step
acquisition accounting treatment and $2.8 million representing Groupe
Aeroplan's share of earnings for the month of March, which is not
indicative of future quarterly results, as it includes an accounting
benefit triggered by the additional investment.

Cash Flow and Financial Position
At March 31, 2011, Groupe Aeroplan had $295.3 million of cash and cash
equivalents, $13.4 million of restricted cash, $0.5 million of
short-term investments and $302.2 million of long-term investments, for
a total of $611.5 million.

Groupe Aeroplan's Free Cash Flow was negative $47.0 million for the
first quarter of 2011 compared to negative $66.0 million for the same
period last year.

Amendment to Existing Credit Facilities
On May 6, 2011, Groupe Aeroplan concluded an amendment to its existing
credit facilities with its lending syndicate. The Corporation repaid
$100 million outstanding under its term facility with funds drawn from
its revolving facility, and the term facility was terminated. The new
secured credit facility, which now only consists of a revolving
facility in the amount of $300 million, matures April 23, 2014, and
ranks pari passu with Groupe Aeroplan's Senior Secured Notes Series 1 due April 23,
2012, Series 2 due September 2, 2014 and Series 3 due January 26, 2017.
Depending on the Corporation's credit ratings, the revolving facility
bears interest at rates ranging between Canadian prime rate plus 1.25
per cent to 2.00 per cent and the Bankers' Acceptance and LIBOR rates
plus 1.75 per cent to 3.00 per cent. The new facility includes
amendments to certain restrictive covenants, including covenants
relating to distributions and the Aeroplan Canada redemption reserve,
which will provide the Corporation with additional flexibility to
execute its strategic plan.

Reserve Policy
On May 25, 2011, upon recommendation from management, the board of
directors approved a $100 million reduction of the Aeroplan Canada
redemption reserve from $400 million to $300 million. Management
believes that the reduced reserve is sufficient to cover redemption
costs, including redemption costs incurred in periods of unusually high
redemption activity, as they become due in the ordinary course of
business. The reduced reserve is consistent with our investment grade
rating parameters and compliant with the covenants contained in our
credit facility.

Normal Course Issuer Bid
During the first quarter of 2011, pursuant to the NCIB previously
announced on May 11, 2010, the corporation purchased 4,468,500 common
shares for total cash consideration of $58.1 million. Subsequent to
March 31, 2011, and up to and including May 13, 2011, Groupe Aeroplan
repurchased and cancelled 2,492,231 common shares for total cash
consideration of $32.4 million. In addition, on May 12, 2011, Groupe
Aeroplan received approval from the Toronto Stock Exchange and
announced the renewal of its NCIB to repurchase up to 18,001,792 of its
issued and outstanding common shares during the period from May 16,
2011 to May 13, 2012. Total common shares repurchased and cancelled
during the period from May 16, 2011 to May 24, 2011, pursuant to the
renewed NCIB, amounted to 310,000 for a total cash consideration of
$4.0 million.

Dividend Policy and Dividends Declared
On May 25, 2011, the Board of Directors approved a 20% increase to the
dividends payable on the Corporation's common shares to $0.60 per
common share per year, or $0.15 per common share per quarter.

Common Shares
The Board of Directors declared a quarterly dividend of $0.15 per common
share, payable on June 30, 2011 to shareholders of record at the close
of business on June 16, 2011.

Preferred Shares
The Board also declared a quarterly dividend in the amount of $0.40625
per Cumulative Rate Reset Preferred Share, Series 1, payable on June
30, 2011 to the holders of record at the close of business on June 16,
2011.

Dividends paid by Groupe Aeroplan to Canadian residents on both its
common and preferred shares are "eligible dividends" for Canadian
income tax purposes.

2011 Outlook

Other than an update with respect to Carlson Marketing's contribution to
2011 Adjusted EBITDA, the Corporation has no revisions to the 2011
annual guidance provided in the February 24, 2011 earnings press
release. Operating results are subject to seasonal variations and are
not indicative of our expectations for the full year. Regional
guidance has now been provided under the new reporting segments. This
update reflects the new operating segments and does not change our
guidance.

Guidance (as provided February 24, 2011)
For the year ending 2011, Groupe Aeroplan expects to report the
following on a consolidated basis:

Target Range

Gross Billings

Between 4 per cent and 6 per cent growth

Adjusted EBITDA1

Between $355M and $365M

Free Cash Flow 2 & 3

Between $190M and $210M

1. Within the consolidated Adjusted EBITDA target range, Carlson
Marketing is expected to generate Adjusted EBITDA margins of between 6
per cent to 8 per cent excluding the impact of costs associated with
the phasing out of a portion of the Visa business in the US and
restructuring costs related to the creation of the Groupe Aeroplan
regional structure.
2. Free Cash Flow before dividends and excluding an anticipated net
payment of $72.2 million (£46.3 million) related to the ECJ VAT
Judgment, which will reduce cash from operating activities in the
statement of cash flows. Upon settlement of the ECJ VAT Judgment, cash
proceeds from funds held in escrow of $42.3 million (£27.1 million) and
related interest of approximately $1.2 million (£0.8 million) will be
classified as cash from investing activities in the statement of cash
flows and will partly offset the above payment. The net cash outflow
expected in 2011 related to the ECJ VAT Judgment, based on accrued
balances at March 31, 2011, is estimated to be $28.7 million (£18.4
million).
3. The Free Cash Flow outlook range of $190 million to $210 million
includes an assumption of planned incremental spend of $45 million to
$65 million when compared to 2010, relating primarily to higher
redemptions expected at Nectar Italia as members start reaching
redemption thresholds and redemption velocity starts to accelerate,
higher redemptions at Aeroplan Canada resulting from program
improvements and investments made to improve member engagement, higher
capital expenditures and increased cash taxes. Note that 2011 Free Cash
Flow will be impacted by the full year payment of preferred share
dividends ($11 million) and an additional interest payment on the
Senior Secured Notes Series 3 ($7 million) and will not have the
benefit of interest proceeds and prepayment charges from the Air Canada
Club Loan ($16 million) received in 2010.

Capital expenditures for 2011 are expected to be approximately $55
million. The current income tax rate is anticipated to approximate 30
per cent in Canada, and the Corporation expects that no significant
cash income taxes will be incurred in the rest of its foreign
operations.

For 2011, on a segmented basis, Groupe Aeroplan anticipates the
following Gross Billings growth from its operating segments:

Region

Target Growth Range of Gross Billings

Canada

Between 4 per cent and 6 per cent

EMEA

Between 12 per cent and 15 per cent

US & APAC 4

Between negative 10 per cent and negative 7 per cent

4. Year over year Gross Billings reduction reflects the full year impact
of US$60 million resulting from the phasing out of a portion of the
overall Visa business in the US.

The Average Cost of Rewards per Aeroplan Mile Redeemed for 2011 is not
expected to exceed 0.95 cents, with gross margin remaining relatively
stable.

The above excludes the effects of fluctuations in currency exchange
rates. In addition, Groupe Aeroplan made a number of economic and
market assumptions in preparing its 2011 forecasts, including
assumptions regarding the performance of the economies in which the
Corporation operates, market competition and tax laws applicable to the
Corporation's operations. The Corporation cautions that the assumptions
used to prepare the above forecasts for 2011, although reasonable at
the time they were made, may prove to be incorrect or inaccurate.
Accordingly, our actual results could differ materially from our
expectations as set forth in this news release. The outlook provided
constitutes forward-looking statements within the meaning of applicable
securities laws and should be read in conjunction with the "Caution
Concerning Forward-Looking Statements" section.

Use of Non-GAAP Financial Information
In order to provide a better understanding of the results, the following
indicators are used:

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization
EBITDA adjusted for certain factors particular to the business, such as
changes in deferred revenue and Future Redemption Costs ("Adjusted
EBITDA"), is used by management to evaluate performance, and to measure
compliance with debt covenants. Management believes Adjusted EBITDA
assists investors in comparing the Corporation's performance on a
consistent basis without regard to depreciation and amortization, which
are non-cash in nature and can vary significantly depending on
accounting methods and non-operating factors such as historical cost.

Adjusted EBITDA is not a measurement based on GAAP, is not considered an
alternative to operating income or net income in measuring performance,
and is not comparable to similar measures used by other issuers. For a
reconciliation to GAAP, please refer to the Summary of Consolidated
Operating Results and Reconciliation of EBITDA, Adjusted EBITDA,
Adjusted Net Earnings and Free Cash Flowincluded in the attached schedule. Adjusted EBITDA should not be used as
an exclusive measure of cash flow because it does not account for the
impact of working capital growth, capital expenditures, debt repayments
and other sources and uses of cash, which are disclosed in the
statements of cash flows.

Adjusted Net Earnings
Net earnings attributable to equity holders of the Corporation adjusted
for Amortization of Accumulation Partners' contracts, customer
relationships and technology, Change in deferred revenue, Change in
Future Redemption Costs and the income tax effect thereon calculated at
the effective income tax rate as reflected in the statement of
operations, provides a measurement of profitability calculated on a
basis consistent with Adjusted EBITDA.

Adjusted Net Earnings is not a measurement based on GAAP, is not
considered an alternative to net earnings in measuring profitability,
and is not comparable to similar measures used by other issuers. For a
reconciliation to GAAP, please refer to the Summary of Consolidated
Operating Results and Reconciliation of EBITDA, Adjusted EBITDA,
Adjusted Net Earnings and Free Cash Flow included in the attached
schedule.

Standardized Free Cash Flow ("Free Cash Flow")
Free Cash Flow is a non-GAAP measure recommended by the CICA in order to
provide a consistent and comparable measurement of free cash flow
across entities of cash generated from operations and is used as an
indicator of financial strength and performance.
Free Cash Flow is defined as cash flows from operating activities, as
reported in accordance with GAAP, less adjustments for:

(a)

total capital expenditures as reported in accordance with GAAP; and

(b)

dividends, when stipulated, unless deducted in arriving at cash flows
from operating activities.

For a reconciliation to cash flows from operations please refer to the
Summary of Consolidated Operating Results and Reconciliation of EBITDA,
Adjusted EBITDA, Adjusted Net Earnings and Free Cash Flow included in
the attached schedule.

EBITDA and Free Cash Flow are non-GAAP measurements recommended by the
CICA in accordance with the draft recommendations provided in their
February 2008 publication, Improved Communications with Non-GAAP Financial Measures - General
Principles and Guidance for Reporting EBITDA and Free Cash Flow.

Constant Currency
Because exchange rates are an important factor in understanding period
to period comparisons, the presentation of various financial metrics on
a constant-currency basis or after giving effect to foreign exchange
translation, in addition to the reported metrics, helps improve the
ability to understand operating results and evaluate performance in
comparison to prior periods. Constant-currency information compares
results between periods as if exchange rates had remained constant over
the periods. Constant currency is derived by calculating current-year
results using prior-year foreign currency exchange rates. Results
calculated on a constant-currency basis should be considered in
addition to, not as a substitute for, results reported in accordance
with GAAP and may not be comparable to similarly titled measures used
by other companies.

Q1 2011 Conference Call / Audio Webcast
Groupe Aeroplan will host a conference call to discuss its first quarter
2011 financial results at 8:00 a.m. ET on Thursday May 26, 2011. The
call can be accessed by dialing 1-800-731-5319 or 416-644-3426 for the
Toronto area. The call will be simultaneously audio webcast at: http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=33644680.

Supporting slides for the call will also be available the evening of May
25, 2011. An archive of the audio webcast and a copy of the slides will
be available at: http://www.groupeaeroplan.com/pages/invEvents.php for ninety days following the original broadcast.

About Groupe Aeroplan Inc.
Groupe Aeroplan Inc., a global leader in loyalty management, owns
Aeroplan, Canada's premier coalition loyalty program, Carlson
Marketing, an international loyalty marketing services, engagement and
events provider, as well as Nectar, the United Kingdom's largest
coalition loyalty program. Groupe Aeroplan also operates LMG Insight &
Communication, an international customer-driven insight and data
analytics business. In addition, Groupe Aeroplan has majority equity
positions in Air Miles Middle East and Nectar Italia as well as a
minority position in Club Premier, Mexico's leading coalition loyalty
program. For more information about Groupe Aeroplan, please visit www.groupeaeroplan.com.

Caution Concerning Forward-Looking Statements
Forward-looking statements are included in this news release. These
forward-looking statements are identified by the use of terms and
phrases such as "anticipate", "believe", "could", "estimate", "expect",
"intend", "may", "plan", "predict", "project", "will", "would", and
similar terms and phrases, including references to assumptions. Such
statements may involve but are not limited to comments with respect to
strategies, expectations, planned operations or future actions.

Forward-looking statements, by their nature, are based on assumptions
and are subject to important risks and uncertainties. Any forecasts,
predictions or forward-looking statements cannot be relied upon due to,
among other things, changing external events and general uncertainties
of the business and its corporate structure. Results indicated in
forward-looking statements may differ materially from actual results
for a number of reasons, including without limitation, risks related to
the business and the industry, dependency on top accumulation partners
and clients, conflicts of interest, greater than expected redemptions
for rewards, regulatory matters, retail market/economic conditions,
industry competition, Air Canada liquidity issues, Air Canada or travel
industry disruptions, airline industry changes and increased airline
costs, supply and capacity costs, unfunded future redemption costs,
failure to safeguard databases and consumer privacy, consumer privacy
legislation, changes to loyalty programs, seasonal nature of the
business, other factors and prior performance, foreign operations,
legal proceedings, reliance on key personnel, labour relations, pension
liability, technological disruptions and inability to use third party
software, failure to protect intellectual property rights, interest
rate and currency fluctuations, leverage and restrictive covenants in
current and future indebtedness, uncertainty of dividend payments,
managing growth, credit ratings, as well as the other factors
identified throughout this news release.

The forward-looking statements contained herein represent Groupe
Aeroplan's expectations as of May 25, 2011, and are subject to change
after such date. However, Groupe Aeroplan disclaims any intention or
obligation to update or revise any forward-looking statements whether
as a result of new information, future events or otherwise, except as
required under applicable securities regulations.

Includes the effect of a $1.8 million (£1.2 million) expense to cost of
rewards recognized as a result of the ECJ VAT Judgment.

(b)

Excludes depreciation and amortization as well as amortization of Accumulation Partners' contracts, customer relationships and
technology.

(c)

The per unit cost derived from this calculation is retroactively applied to all prior periods with the effect of
revaluing the Future Redemption Cost liability on the basis of the latest available average unit cost.

(d)

The Average Cost of Rewards per GALU for the three month period ended March 31, 2011 includes the unfavourable impact of the ECJ VAT Judgment amounting to $0.4 million(₤0.2 million).

(e)

A non-GAAP measurement.

(f)

After deducting dividends paid on preferred shares.

(g)

Includes the effect of a $1.0 million (£0.6 million) net charge to
interest expense recognized as a result of the ECJ VAT Judgment.

(h)

Effective tax rate calculated as follows: income tax expense per
statement of operations / earnings before income taxes for the period.

(i)

2010 comparative figures do not include any effect related to the adverse impact of the ECJ VAT Judgment.

_____________________________

SEGMENTED INFORMATION

At March 31, 2011, the Corporation had three operating segments: Canada,
EMEA and US & APAC.

Excludes depreciation and amortization as well as amortization of
Accumulation Partners' contracts, customer relationships and
technology.

(b)

Includes depreciation and amortization as well as amortization of
Accumulation Partners' contracts, customer relationships and
technology.

(c)

Includes expenses that are not directly attributable to any specific
operating segment.

(d)

Includes Gross Billings of $99.7 million in the UK and $48.9 million in
the US for the three months ended March 31, 2011compared to Gross Billings of $98.5 million in the UK and $74.0 million
in the US for the three months ended March 31, 2010.

Includes non-current assets of $398.9 million in the UK and $96.4
million in the US as of March 31, 2011 compared to non-current assets
of $399.4 millionin the UK and $97.8 million in the US as of March 31, 2010.

(g)

Includes the effect of a $1.8 million (£1.2 million) expense to cost of
rewards recognized as a result of the ECJ VAT Judgment.

(h)

Includes the effect of a $1.0 million (£0.6 million) net charge to
interest expense recognized as a result of the ECJ VAT Judgment.

(i)

The Average Cost of Rewards per GALU for the three month period ended
March 31, 2011 includes the unfavourable impact of the ECJ VAT Judgment amounting to $0.4 million (₤0.2 million).

(j)

Includes a loss of $1.8 million relating to the fair value adjustment of
the Air Canada Warrants for the three months ended March 31, 2011 compared to a gain of $1.5
million for the three months ended March 31, 2010.

(k)

A non-GAAP measurement.

(l)

Comparative figures have been reclassified to conform with the new
segmentation and do not include any effect related to the adverse
impact of the ECJ VAT Judgment.